Euro Gains Ahead of Next Week’s European Central Bank Meeting – What Will They Do?
The euro bounced back against the US dollar and made small gains against the Canadian dollar, British pound, and New Zealand dollar after the final reading of Q3 GDP for the Euro-zone was slightly better than expected, as the annual rate was revised up to -4.0 percent from -4.1 percent, while the quarterly rate went unchanged at 0.4 percent. A breakdown showed that business investment contracted 0.8 percent after contracting 1.6 percent in Q2, household spending slipped 0.1 percent following a 0.1 percent increase in Q2, and government spending registered at 0.6 percent once again. Additionally, both exports and imports improved, the former by 3.1 percent and the latter by 3.0 percent. All told, the Q3 GDP results aren’t likely to have a big impact on the European Central Bank’s policy bias, and as a result, they are anticipated to leave rates unchanged at 1.00 percent on January 14. Where the currency ends the day, though, may have more to do with what ECB President Jean-Claude Triche
